Australia appointed its first woman Prime Minister, Julia Gillard, who vowed on Thursday to end division over a controversial mining tax, resurrect a carbon trade scheme and call elections within months. Former PM Kevin Rudd made an emotional and ignominious exit, quitting just before the centre-left Labour Party was to dump him in an internal ballot and less than three years after a stunning election victory in 2007. The Rudd government’s dramatic slide in support this year sparked fears within the ruling party of an electoral defeat at a poll expected around October.
“I asked my colleagues to make a leadership change because I believed that a good government was losing its way,” Ms Gillard told a press conference.
Bookmaker Centrebet made a Gillard Labour government outright favourite to win the next election over conservative opponents.
Ms Gillard has long been one of the government’s best performers in Parliament with her ability to sell policies and deflect political attacks.
Ms Gillard, 48, immediately offered to end a bitter dispute over a controversial “super profits” mining tax, which is threatening $20 billion worth of investment and has unnerved voters, saying she would throw open the door to fresh negotiations. “It’s a genuine offer — the door of this government is open ... I’m asking the mining industry to open it’s mind,” she said.
But Ms Gillard stood firm on the introduction of a resource tax, stressing that miners should pay more tax. She said later in Parliament miners had conceded they could pay more.
Miners responded to the leadership change by suspending a multi-million dollar anti-tax advertising campaign and welcoming Ms Gillard’s conciliatory tone.
“We look forward to working with the government in this new way to find a solution that is in the national interest,” said a spokesperson for BHP Billiton, the worlds biggest miner.
But miners also stood firm on their position of reducing the 40 per cent headline tax rate and doubling the threshold of when miners start paying the tax to 12 per cent from 6 per cent.
The Australian dollar briefly jumped after the leadership change, while shares in BHP and Rio Tinto rose around two per cent, outperforming a flat broader market. Ms Gillard’s takeover will see the government resurrect its failed climate change policy, a carbon trade emissions scheme, with the new Prime Minister saying she was disappointed in the government’s failure to pass laws to set a price on carbon.
“I will re-prosecute the case for a carbon price at home and abroad. I will do that as global economic conditions improve and our economy continues to strengthen,” she said.
Greens party leader Senator Bob Brown and institutional investors said they were looking forward to early action on climate change.
Mr Rudd postponed his carbon scheme until 2011. Australia is the world’s top coal exporter and among the highest pre-capita emitters of planet-warming carbon dioxide, with coal used to generate about 80 per cent of electricity.
Mr Rudd became the shortest-serving Australian Prime Minister since 1972, with his leadership falling apart after a string of poor opinion polls.